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Post by jordan on Aug 2, 2017 15:30:34 GMT
Hi folks, We published a review of Zopa this time last year and have just posted a refreshed, up-to-date version. The team has performed detailed analysis on Zopa's loan book. Hope it's of use! You can find it here - Zopa ReviewThanks, Jordan Orca |
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Post by newlender on Aug 2, 2017 16:21:53 GMT
Thanks - very informative and reassuring. Is the average loan size the median or the mean? (I'm assuming the latter).
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aju
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Post by aju on Aug 2, 2017 23:09:45 GMT
Hi folks, We published a review of Zopa this time last year and have just posted a refreshed, up-to-date version. The team has performed detailed analysis on Zopa's loan book. Hope it's of use! You can find it here - Zopa ReviewThanks, Jordan Orca Excellent article its a shame though that publishers feel the need to mess with colour of text without any regard for us oldies or worse people with eye defects. I found the text was in what seems like a light grey - well to me anyway - so I checked it out using the inspect function and changed the ".text-muted" item to zero (Black) and lo it was easier to read again. I wish people would consider their actions when creating things and make them readable to all people. I did learn something new and also banked it for my stylish changes later so I guess all is not lost. This damned webkit stuff is more useless than useful sometimes but I guess that's a whole other forum ;-). Thankfully in chrome, if you know how, you can easily manipulate it, just a shame that web designers seem to be a somewhat all knowing bunch.
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aju
Member of DD Central
Posts: 3,484
Likes: 917
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Post by aju on Aug 2, 2017 23:26:40 GMT
Hi folks, We published a review of Zopa this time last year and have just posted a refreshed, up-to-date version. The team has performed detailed analysis on Zopa's loan book. Hope it's of use! You can find it here - Zopa ReviewThanks, Jordan Orca ok all seemed good until I got to this bit. "The level of diversification Zopa offers is the principal protection afforded to investors. The Zopa platform splits your money into £10 chucks, which are lent to borrowers. If you lend £1,000, which is the minimum you can lend, your exposure to one loan is 1% and if you lend £10,000 your exposure is 0.1%." The 1st part is correct, however anyone lending in blocks of more than £1999 needs to be aware that they will not lend at £10 and therefore the diversification will not be 0.1%. I'm not sure of the max lend amount but lets assume its >£100 a loan then lending a lump sum of £10000 into one product will definitely give the same 1% diversification as a £1000 loan. Currently the only way to ensure £10 blocks and 0.1% diversification on any sum is to lend in lumps of <£2000. It lends slower by virtue of the fact that after the 1st 1999 you have to wait until it is under £1000 before lending the next 1000 and so on. I got it wrong once and lent into it too soon I ended up with 15 or more £20 loans before I realised. That won't happen again ;-) I think this very issue is where some lenders may have hit default problems recently. A default on a £100 is no where near as comfortable as a £10 default and it can skews returns in loan books that are not that mature.
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Post by jordan on Aug 3, 2017 16:22:51 GMT
Thanks - very informative and reassuring. Is the average loan size the median or the mean? (I'm assuming the latter). Hi there, the average loan size is the mean, that's correct.
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Post by jordan on Aug 3, 2017 16:27:13 GMT
Hi folks, We published a review of Zopa this time last year and have just posted a refreshed, up-to-date version. The team has performed detailed analysis on Zopa's loan book. Hope it's of use! You can find it here - Zopa ReviewThanks, Jordan Orca ok all seemed good until I got to this bit. "The level of diversification Zopa offers is the principal protection afforded to investors. The Zopa platform splits your money into £10 chucks, which are lent to borrowers. If you lend £1,000, which is the minimum you can lend, your exposure to one loan is 1% and if you lend £10,000 your exposure is 0.1%." The 1st part is correct, however anyone lending in blocks of more than £1999 needs to be aware that they will not lend at £10 and therefore the diversification will not be 0.1%. I'm not sure of the max lend amount but lets assume its >£100 a loan then lending a lump sum of £10000 into one product will definitely give the same 1% diversification as a £1000 loan. Currently the only way to ensure £10 blocks and 0.1% diversification on any sum is to lend in lumps of <£2000. It lends slower by virtue of the fact that after the 1st 1999 you have to wait until it is under £1000 before lending the next 1000 and so on. I got it wrong once and lent into it too soon I ended up with 15 or more £20 loans before I realised. That won't happen again ;-) I think this very issue is where some lenders may have hit default problems recently. A default on a £100 is no where near as comfortable as a £10 default and it can skews returns in loan books that are not that mature. Hi there, thanks very much for your comments. We appreciate your kind words, and be assured, the grey has been changed to black font! Apologies, it's the default setting on our wordpress. In reference to your second point, I rang Zopa and was informed that the level of diversification is always 1%, so £1,000 is £10 chunks, £2,000 is £20, £10,000 is £100 etc. I've updated our article to reflect this. Always great to get a heads up on these things, so thank you for your feedback. We have more analysis within our login section of our website, where you can also download a more in-depth, detailed report on Zopa. It's free to sign up. Up to you of course  Thanks, Jordan
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aju
Member of DD Central
Posts: 3,484
Likes: 917
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Post by aju on Aug 3, 2017 17:41:29 GMT
Glad to be of assistance Jordan, I did wonder if Wordpress may have been the culprit, thanks for changing it though saves me having to manipulate manually next time i'm in orca at least, it's almost impossible on a tablet but on chrome for the desktop its much easier in a lot of cases to just tweak the offending element to Zero.
Whilst I agree with Zopa that their internal setting is to give 1% diversification, as I said users can manipulate this by lending in particular blocks that suit them. For me this time around with the ISA's and the dropping of the Safeguard I decided to try and get the best diversification I could to reduce the impact of defaults. I think most people will not have noticed as the defaults in SG are sort of masked. I was surprised how many I had in my SG book. The amount I had lent was much higher than before but none the less the defaults on higher value loans can skew things quite markedly.
I thought I already had created an orca account but could not remember the uid/password so tasked myself to have a look later when I had more time.
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